Question 8 (1 point) A firm is considering the decision of investing in new plants, The following is the profit payoff matrix under three conditions: it does not expand, it builds two new plants, or it builds one new plant. Three possible states of nature can exist--no change in the economy, the economy contracts and the economy grows, The firm has no idea of the probability of each state. The sconomy expands Contracts unchanged no new plants $20 million -$3 million $4 million I new plant $30 million -$6 million 36 million 2 new plants $40 million -$12 million 58 million If a loss of 10 million would ruin your firm; what decision would be made using the avoid ruin rule? not enough information to tell O two new plants no new plants one new plantUsing the figure below, which of the short run equilibrium are on the long run expansion path? 200 2150 8130 5too Q = 1,200 60 Q - 800 Q - 400 120 250 375 500 linits of labor O 110 K, 120 L 60 K, 120 L 130 K, 200 L 130 K, 175 L